model, I show that a subsidy on input factors in a Cobb-Douglas production function may contribute substantially to …

, and fuel smuggling. By studying the impact of fuel subsidy reform on consumption, tax incidence, and fiscal efficiency, it … shows that the presence of illicit activities substantially strengthens the argument in favour of subsidy reform: First …, fuel subsidy reform can shift the tax base to energy goods, which are less prone to tax evasion losses than for instance …

ranking of these instruments is inverse to that of the oil and gas industry which prefers renewable subsidy and delaying taxes …